At some point, most of us have struggled with money. When we’re younger and single, it’s not always that much of an issue. It’s surely part of the student experience to live on baked beans and do your shopping in discount stores. Often it’s less of a case of being cheap and more about prioritizing fun stuff over the essentials. Most of us assume that we’ll soon leave school, get a job and never have to worry about money again. Unfortunately, this is rarely the case.
Millions of working families are struggling to pay their bills and feed their families each month. Many of us live paycheck to paycheck, with no rainy day money to cover emergencies and unexpected expenses. Money is tight, luxuries are few and far between, and life is uncomfortable. One unexpected expense, or time off work sick, can lead to our finely balanced finances falling into disarray. When this happens, it’s all too easy to fall into a pattern of debts and borrowing that can seem impossible to break out of.
A family budget won’t automatically improve your finances, and it’s certainly no magic wand. But, the truth is that many of us are spending much more than we need to, and we’ve got no idea either that we are, or what we can do about it. We’re scraping by when really we need to make some changes. So, whether you want to save to pay off your debts, fund a vacation, buy a house, or you just want to make the end of the month more comfortable instead of watching your bank account slip closer and closer to zero, here’s a look at some of the ways that you can slash your family budget.
Create a Budget
We talk about our family budgets, eating on a budget, and budgeting for holidays but most of us don’t actually have a budget. We’ve got vague ideas, but no on paper budget that lets us see where our money is coming from and going. Most of us have absolutely no idea how much we can afford to spend each month once our bills have been paid, never mind splitting that into weeks and days. You might check your bank account balance before making a purchase, but do you know how that purchase might affect the rest of the month?
Making a budget sounds complicated, but really it just means writing everything down. Creating a household budget spreadsheet is easy enough using a template, but if you’d prefer, you can do it on paper. However, doing it electronically means that it’s much easier to make changes, and to see how changes will affect your overall cash flow, before committing to them
The most important things to remember when creating your budget are to be honest and realistic. It won’t help you if you don’t add everything. You might not want to admit to spending that much on Starbucks, but if you don’t, your budget won’t be accurate. Then, when it comes to making cuts, don’t commit to anything that you can’t stick to. An accurate budget is helpful when it comes to tracking income and outgoings, spotting patterns, and finding ways to save, a budget filled with lies and false promises is no good to anyone.
Set Goals for Yourself
Have you ever found that it’s much easier to save for something specific than it is just to save? You might start each new year with the hopes of saving money or paying off your debts, only to find that by the end of the year, very little progress has been made. But, if you need to pay off a vacation in June, you will manage it.
Specific targets are easier to stick to than vague aspirations. Saving for a vacation is easier than saving to buy a house one day in the future. But, if you were looking at a specific house for sale in 2019, and you knew exactly how much you needed as deposit, you’d have a better chance.
So, set yourself some small targets. If you want to pay off your debts, take a look at your budget and what you can afford to save, and set yourself an amount that you wish to pay off every month, or even week, instead of just looking at the whole debt amount
Make Some Switches
Once you’ve got a budget, it’s easy to see where your money is going, which means that you can start to make some changes. Did you know that you can switch your energy suppliers, internet providers, and even bank accounts as long as you’re not tied to a minimum contract? And even then, it can sometimes still be cost effective to pay a cancellation fee to switch, if the switch would save you money long-term.
Get into the habit of checking to make sure you are on the right deals once a year. Set an annual reminder on your phone, and free up a morning to make some calls. You can also use this time to look at balance transfers for your debts
And Some Cuts
Of course, there’s an even better way to save. You can switch accounts, but you’ll still be paying money. Your budget probably also includes things that you can cut entirely like unused gym memberships, coffees out and subscription services that you could comfortably live without. You might also be able to reduce costs on things like your mobile phone contract and home internet provider if you are currently paying for more than you actually use.
Start Meal Planning
Food is a massive expense. Sure, it’s necessary, and no one would tell you to drastically reduce what you eat to save money. But, that doesn’t mean that you’re not spending a lot more than you need to. The reality is, most families waste food. At the end of each week, we throw things away that we haven’t had the chance to eat, and this is usually because we shop without a plan.
Start writing meal plans for the week ahead, so that you know exactly what you need to buy for your meals. Then, check your pantry to see what you need to buy before writing your shopping list. You might also find that it’s cost-effective to cook meals in large batches, buying in bulk, and freezing leftovers for an easy meal another day. Some people also find that shopping online or hitting the stores when they know the clearance section is being stocked, can help them to make huge savings.
Get Your Priorities Right
When it comes to spending money, most of us need to prioritize sometimes. There are not many people that can just go out and buy what they want whenever they want, and if you are reading this article, you are unlikely to be one of them.
Sometimes, you’ll have to sacrifice the luxuries in your shopping basket to pay your credit card bill. But, that’s not to say that you can’t have luxuries. After a hard week, it’s absolutely okay for a bottle of wine and a nice meal to be a priority over saving if you can afford it. You should just find ways to save on it like cooking at home instead of going out or buying a cheaper bottle. Then, take responsibility for the spend instead of ignoring it and try to find somewhere else to save. Saying no to treats is tough, and over time not buying anything that you like can start to get a little depressing. While there are some great ways to treat yourself without spending a penny, it’s ok to spend a little now and then, if it keeps you on track the rest of the time.